Saturday, September 12, 2009

A Faint Glimmer of Sense

Oh, I know. You've been taught that tariffs are protectionism, and protectionism is evil.

It also happens to be one of the principle means by which economic empires are built, jobs--jobs worth having, as opposed to service jobs--are created, and real wages made to rise.

Real wages--adjusted for inflation--have been steadily declining since this country decided to go the "free trade" route. Seeing some move, almost any move, away from that policy is music to my ears.

Oh, but--oooooh! The article said we risked

...angering the nation's second-largest trading partner.

So (badword)what? China protects her own markets already. If anyone's retaliating in this scenario, it's us.

Ticks me off every time I think about it. Chinese workers are notoriously badly paid (though that pay is rising), safety is not a concern, pollution is not a concern, etc., and when U.S. firms have a hard time competing with companies that have little or nothing to worry about in terms of worker pay, worker safety, pollution, and so forth, and seek a protective tariff, we get all huffy and tell them to get "competitive." They get "competitive," alright; they move their manufacturing overseas. It's insane.

Tariffs, friends, were the principle means by which the U.S. government was financed right up 'til the time of the first World War, and remained important up 'til the seventies. Are you blind to the fact that this was the period of time during which the United States became the world's foremost economic power? Tariffs are a perfectly legitimate means of financing a government, every bit as legitimate as the hideous income tax, and they have a far better track record. They made an economic colossus out of Great Britain (which they then lost when they went the free trade route), they made an economic colossus out of the United States (which is suffering greatly by having gone the free trade route), and they brought Japan back from the economic death of World War II.

Admittedly, tariffs are not without their flaws. Even better would be enacting the Fair Tax, which, of course, has a very similar effect to tariffs in one way, that is, it creates an enormous tax advantage to manufacturing in this country.